\u3000\u3000 Zhejiang Sanmei Chemical Industry Co.Ltd(603379) (603379)
In 2021, the net profit deducted from non parent company increased by 176.25% – 248.60% in advance, maintaining the “buy” rating
On January 21, 2022, the company released the performance forecast for 2021, which is expected to realize the net profit attributable to the parent company of 470-580 million yuan, with a year-on-year increase of about 111.9% – 161.4%; It is expected to realize a net profit of 420-530 million yuan, a year-on-year increase of about 176.3% – 248.6%; It is estimated that in 2021q4, the net profit deducted from non parent company is RMB 187-297 million, with a significant year-on-year turnaround and a month on month increase of about 114.0% – 239.7%. The company’s performance forecast meets our expectations. We maintain the company’s profit forecast unchanged. It is estimated that the net profit attributable to the parent company from 2021 to 2023 will be 509, 835 and 1102 million yuan, and the EPS will be 0.83, 1.37 and 1.81 yuan / share respectively. The current share price corresponds to 24.0, 14.6 and 11.1 times of PE from 2021 to 2023, maintaining the “buy” rating.
R142b may continue to be in short supply, and the profitability of HFCS refrigerants has improved
Benefiting from the rapid growth of downstream PVDF (polyvinylidene fluoride) demand, the company’s product R142b, as the raw material of PVDF, is in short supply in the market, with a large year-on-year increase in price and a significant year-on-year increase in product gross profit margin. According to the data of Baichuan Yingfu, the annual average price (tax included) of R142b in 2021 was 83000 yuan / ton, a year-on-year increase of 425.0%. The supply and demand pattern of R142b, which is used as PVDF raw material, is difficult to reverse in the short term and is expected to continue to contribute higher profits to the company. Meanwhile, the gross profit margin of HFCS refrigerant, the company’s main product, has improved compared with 2020, which has a partial positive impact on the company’s performance. According to the data of Baichuan Yingfu, the annual average prices (including tax) of R134a, R125, R32 and R22 in 2021 were RMB 26000, 34000, 14000 and 17000 / T respectively, with a year-on-year increase of + 47.9%, + 118.3%, + 16.4% and + 19.9% respectively. The dark time of the refrigerant industry has passed. With the arrival of quotas approaching, the inflection point of the refrigerant industry may have arrived. The production capacity of R32, R125, R134a, R22 and R142b of the company is 4, 5.2, 6.5, 1440 and 4200 tons respectively. It is China’s leading refrigerant enterprise. The rise of a highly deterministic cycle of the refrigerant industry in the future will bring greater performance flexibility to the company.
The bottom repurchase of 165 million yuan was used for the employee stock ownership plan to demonstrate confidence in future development
On December 15, 2021, the company announced that it had completed the share repurchase. The average price of this repurchase was 25.05 yuan / share, and the total repurchase amount was about 165 million yuan. On January 10, 2022, the company issued the first phase of the employee stock ownership plan. The total number of employees participating in the plan is no more than 330, including 10 directors (excluding independent directors), supervisors and senior managers. The price of the transferred shares is 12.53 yuan / share. The shares will be unlocked in three phases and assessed according to the company’s performance appraisal management system.
Risk tips: safety production risk, policy change risk, sluggish terminal consumption, etc.
